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Another California City Launches a Two-Year Guaranteed Income Program

The Los Angeles Times reports a new guaranteed income pilot program which within a few months “will begin giving 800 Compton residents free cash for a two-year period,” according to mayor Aja Brown:
So far, private donors have contributed $2.5 million to the Fund for Guaranteed Income, a charity headed by Nika Soon-Shiong, daughter of Los Angeles Times owner Patrick Soon-Shiong… Each selected family will receive at least a few hundred dollars on a recurring basis, as well as tools that will help them access financial guidance, Brown said. Parents or other residents caring for dependents may receive more. Anonymous researchers will track the participants’ spending and well-being.

Brown said she had been aware of the concept of universal guaranteed income for years, but got to see it in action in February 2019 when Stockton Mayor Michael Tubbs launched the Stockton Economic Empowerment Demonstration, which gave 125 residents $500 a month for 18 months… The concept of giving citizens free money with no strings attached was once a radical idea that has begun gaining traction, partly as a result of the pandemic. Opponents of guaranteed income have argued that extra cash with no strings attached would lead to higher levels of unemployment and that recipients might spend the money on drugs or alcohol or other “temptation goods.”

But decades of research has indicated that very few people work less after receiving cash transfers, and those who do use usually spend more with their families, said Halah Ahmad, head of public relations and policy communications for the Jain Family Institute, a nonprofit research firm that helps design guaranteed income pilot programs. In a review of 19 studies on cash transfers between 1997 and 2014 by the World Bank, authors found that “Almost without exception, studies find either no significant impact or a significant negative impact of transfers on temptation goods.”

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